Amazon wants to ship your stuff before you buy it

A new patent filing demonstrates one more way the online retailer hopes to leverage its vast trove of customer data to edge out rivals.

By Jon Gorey Jan 21, 2014 3:01PM

The Wall Street Journal on MSN MoneyEmployee Lamar Roby prepares shipping orders at Amazon's San Bernardino, Calif., Fulfillment Center. Photo by Kevork Djansezian/Getty ImagesBy Greg Bensinger, The Wall Street Journal


Amazon.com (AMZN) knows you so well it wants to ship your next package before you order it.


The Seattle retailer in December gained a patent for what it calls "anticipatory shipping," a method to start delivering packages even before customers click "buy."


The technique could cut delivery time and discourage consumers from visiting physical stores. In the patent document, Amazon says delays between ordering and receiving purchases "may dissuade customers from buying items from online merchants."


So Amazon says it may box and ship products it expects customers in a specific area will want – based on previous orders and other factors — but haven't yet ordered. According to the patent, the packages could wait at the shippers' hubs or on trucks until an order arrives.

 

In deciding what to ship, Amazon said it may consider previous orders, product searches, wish lists, shopping-cart contents, returns and even how long an Internet user's cursor hovers over an item.


Today, Amazon receives an order, then labels packages with addresses at its warehouses and loads them onto waiting UPS, USPS or other trucks, which may take them directly to customers’ homes or load them onto other trucks for final delivery.


It has been working to cut delivery times, expanding its warehouse network to begin overnight and same-day deliveries. Last year, Amazon said it is working on unmanned flying vehicles that could take small packages to homes directly from its warehouses.


In the patent, Amazon does not estimate how much the technique will reduce delivery times.


The patent exemplifies a growing trend among technology and consumer firms to anticipate consumers' needs, even before consumers do. Today, there are refrigerators that can tell when it’s time to buy more milk, smart televisions that predict which shows to record and Google's (GOOG) Now software, which aims to predict users' daily scheduling needs.


It's not clear if Amazon has deployed or will deploy the technique. A spokeswoman declined to comment.


But the patent demonstrates one way Amazon hopes to leverage its vast trove of customer data to edge out rivals.


"It appears Amazon is taking advantage of their copious data," said Sucharita Mulpuru, a Forrester Research (FORR) analyst. "Based on all the things they know about their customers they could predict demand based on a variety of factors."


According to the patent, Amazon may fill out partial street addresses or zip codes to get items closer to where customers need them, and later complete the label in transit, the company said. For large apartment buildings, "a package without addressee information may be speculatively shipped to a physical address . . . having a number of tenants," Amazon said in the patent.


Amazon said the predictive shipping method might work particularly well for a popular book or other items that customers want on the day they are released. As well, Amazon might suggest items already in transit to customers using its website to ensure they are delivered, according to the patent.


Of course, Amazon's algorithms might sometimes err, prompting costly returns. To minimize those costs, Amazon said it might consider giving customers discounts, or convert the unwanted delivery into a gift. "Delivering the package to the given customer as a promotional gift may be used to build goodwill," the patent said.


More from The Wall Street Journal

182Comments
Jan 21, 2014 9:26PM
Jan 21, 2014 4:19PM
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I'm in shipping, they will get killed with returns because UPS and Fed Ex will not have the space to hold inventory. This is almost as  dumb as the drone idea. They would be better off just  to expand their 2 day shipping.
Jan 21, 2014 5:26PM
Jan 21, 2014 6:03PM
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Firstly - Amazon is not shipping the item to the customer. It is planning to ship it to the nearest warehouse to be held, such that when the customer finally makes the BUY decision, the time to ship will be order of magnitude less. 
Secondly people wondering about how amazon is willy nilly going to send stuff to warehouse in anticipation of people buying it, Let me explain something about data mining to you. 
Amazon has for yearsssss been studying what a customer does on its website. You search, you wishlist, you compare, you go away. You come back and you do some more research and then you order. 

How long do you search. How many reviews you read, your past buying history. The various price points you have considered and finally the price point at which you made the purchase. The time of the year you made the purchase - closer to the holiday, a few days after getting a paycheck. The time after tax refunds.  
Quantifying customer behavior and using it to predict future trend is a very finally tuned science.  There is a whole branch of mathematics dedicated to it called Predictive Analysis. 
With personal computers that are as powerful as the super computers of yore, with new computing paradigm such as hadoop big data and the ability to farm out massive computational jobs to a cluster of cheap commodity servers, the ability of business to process slice and dice the data has reached what used to be the realm of science fiction. 

Rest assured - that when Amazon ships that product to the warehouse to be held, in majority of the cases the customer will be making that buy decision pretty soon.

For the science fiction buffs familiar with Asimov's Foundation series, What we are seeing in the field of data mining, business intelligence and predictive analysis is the beginning of what someday might mature into psycho-history. 

Jan 21, 2014 5:18PM
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A man feared his wife wasn't hearing as well as she used to and he
thought she might need a hearing aid.

Not quite sure how to approach her, he called the family doctor to

discuss the problem.

The Doctor told him there is a simple informal test the husband could

perform to give the doctor a better idea about her hearing loss.
Here is what you do," said the Doctor, "stand about 40 feet away from her, and in a normal conversational speaking tone see if she hears you.

If not, go to 30 feet, then 20 feet, and so on until you get a response."
That evening, the wife is in the kitchen cooking dinner, and he was in

the den. He says to himself, "I'm about 40 feet away, let's see what

happens."
Then in a normal tone he asks, 'Honey, what's for dinner?"

No response.

So the husband moves closer to the kitchen, about 30 feet from his wife

and repeats, "Honey, what's for dinner?"

Still no response.

Next he moves into the dining room where he is about 20 feet from his

wife and asks, "Honey, what's for dinner?"

Again no response.
So, he walks up to the kitchen door, about 10 feet away.

"Honey, what’s for dinner?"

Again there is no response.
So he walks right up behind her... "Honey, what’s for dinner


"Ralph, for THE ****ING TIME, CHICKEN!"



__,_._,___
 


Jan 21, 2014 5:05PM
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That's one reason why I cancelled a magazine subscription.  They assumed that you wanted to keep getting it and the bill for it instead of giving you the option to say "yes" please renew my subscription.  Just another greedy idea that MBA's come up with when they aren't figuring out how to eliminate their employee's jobs.
Jan 21, 2014 9:47PM
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 God Bless America..

'Bless me Father, for I have sinned.
I have been with a loose girl . . .'

The priest asks, 'Is that you, little Dominic Savino?'

'Yes, Father, it is.'

'And who was the girl you were with?'

'I can't tell you, Father. I don't want to ruin her reputation.'

"Well, Dominic, I'm sure to find out her name sooner or later
so you may as well tell me now. Was it Tina Minetti?'

'I cannot say.'

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'I'll never tell.'

'Was it Nina Capelli?'

'I'm sorry, but I cannot name her.'

'Was it Cathy Piriano?'

'My lips are sealed.'

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The priest sighs in frustration.
'You're very tight lipped, and I admire that.
But you've sinned and have to atone.
You cannot be an altar boy now for 4 months.
Now you go and behave yourself.'

Joey walks back to his pew,
and his friend Franco slides over and whispers,
'What'd you get?'

'Four months vacation and five good leads.'


Jan 21, 2014 4:58PM
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LOL they want Fedex, UPS, and USPS to be storage facilities for itmes that may or may not be ordered?  even if their program can predict that I'm going to buy an item there is no way to predict when I'd buy the item.  Sounds like Amazon needs to start making their own hubs in major cities with warehouses and have their own delivery service for single day delivery.
Jan 21, 2014 7:11PM
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I should send them my course syllabus so students will quit whining that they still haven't received their books four weeks into the semester.
Jan 21, 2014 9:52PM
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If they can track how long a cursor hovers over an item, I'm not at all surprised what the NSA has capability of doing. Amazing! and scary.
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You would most likely not get it at your residence as anything that is sent to you and you did not order it, is yours free of charge.  That has been the law for years.  If they keep asking you to send it back, just tell them you did not receive it.  They have no proof you did unless you sign for it.

This was put into place to stop the corruption of vendors who would send you something cheap and demand payment for it.  Most likely more than it was ever worth.   

Jan 21, 2014 5:11PM
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So, they're going to ship you a package you didn't order and figure they'll make a fortune off the people who'd just rather pay for an order they didn't want than to take the time and effort to re-package and return it.

 

It's an interesting idea, but, in my opinion, not a very good one. Amazon customers will get so mad at being sent things they didn't order and then be expected to pay full price for them. If Amazon does do this, they should at least make it an option you have to sign up for or else they will get A LOT of angry complaints from annoyed customers (and I'd certainly be one of them!).

Jan 21, 2014 7:11PM
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This just in --- Amazon drones to be equipped with credit card swipes and tasers.
After you get everything on your wish list and shopping cart (whether you ordered it or not) YOU PAY OR GET A SPANKIN
Jan 21, 2014 7:15PM
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As long as payment is OPTIONAL for any thing shipped at Amazon's OPTION --- then it's fine.

---- CASE CLOSED ----
Jan 21, 2014 11:53PM
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This isn't exactly a new idea. Retailers have been doing for years. Contact lens companies, Columbia house even Barnes & Noble utilize " anticipatory shipping" just another concept that Bezos copies from others. If you take a few moments to search the Internet before buying your next item, you'd be surprised just how many vendors offer far better pricing than amazon and nearly very vendor offers free shipping so why pay amazon $79 for that privilege.  Absolutely free movies can be found at Hulu and Crackle, another reason to move on from amazon. I really don't need amazon scrutinizing what I buy and when. They have become much too invasive
Jan 21, 2014 10:20PM
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Company sends you a product you did NOT order..you are NOT obligated to pay..nor are you obligated to PAY to send it back. It becomes classified as a "gift"
I'd certainly be sending them a bill for my time and gas if I were having to make trips to return things I did not order in the 1st place.
I understand the concept they are TRYING to set in place, but I believe there will be many items left to gather dust on shelves, waiting for an actual order. People's tastes change from time to time and what was working one day may no longer be desired. Better rethink this idea...not to practical..

Jan 22, 2014 12:44AM
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funny stuff , my luck I would fall asleep while mouse hovering some item and end up with a few hundred piling up on the doorstep (it would by far not be the first time I fell asleep at the computer) .
Jan 22, 2014 12:28AM
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Personally I'm perfectly happy with the speed I currently receive packages from Amazon. Even when I use 3-5 day shipping, my package tends to arrive within 2-3 days (unless unforeseen factors such as bad weather delays it, which Amazon can't help anyway). It's great they're trying to anticipate what will be ordered most in certain areas and cut delivery times, but I say if people don't have the foresight to order something they know they need in advance of when they need it, that's their own fault.
Jan 21, 2014 10:15PM
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If they send me something I did not order...I am under NO obligation to send it back...either at their expense or mine.

 

Jan 22, 2014 12:04AM
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In related news, Amazon announced the hiring of famed Jamaican psychic Miss Cleo.  In a statement, Miss Cleo said: "Don't you worry about your packages, 'cause everythings gonna be alright, now that Miss Cleo is on the job. I know when you want someting even before you do!"
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